Unemployment Rate Falls To 7.09% In September, Touches Record 12-Month Low

Urban unemployment levels also fell from 10.09 per cent in August to 8.94 per cent in September this year, due to increased hiring at the field-level to cater to the demand as Diwali nears. 

The data revealed that the rural participation rate touched 41.82 per cent in the period, marking a record high in the last 23 months.

Source : Getty

India’s unemployment rate dropped to a record low of 7.09 per cent in September driven by the boost in economic activities in the festive season. The data, released by the Centre for Monitoring Indian Economy, noted that the unemployment rate in September dipped to a 12-month low. Urban unemployment levels also reported a sharp dip from 10.09 per cent in August to 8.94 per cent in September this year. The improved numbers indicated increased hiring at the field-level to cater to the demand as Diwali nears. 

The data further noted that the rural unemployment rate also dipped to a record 12-month low of 6.20 per cent in September. This decline was credited to the surplus rainfall received in September, reported Financial Express. Notably, the country received 36 per cent below normal level rainfall in August, while September witnessed rainfall at more than 13 per cent above normal levels. 

The data also pointed out that rural employment levels in September declined as a result of the decrease in demand for work under the Mahatma Gandhi National Rural Employment Guarantee Scheme, which stayed elevated for several months. The official data revealed that the number of people demanding work under the scheme fell to the lowest level in September in the current fiscal year. Further, the number of person days generated (work provided) in September also touched the lowest levels so far in 2023-24. Meanwhile, labour participation rate in September inched up in rural areas in comparison to August, while urban areas reported a fall in the period. 

The report quoted Lekha Chakraborty, professor at the National Institute of Public Finance and Policy, and said, “Agricultural sector is still monsoon dependent. The gross capital formation (GFCF) in the agriculture sector is declining. So, if there is an erratic monsoon, it affects the economic activity and labour force participation.” 

The data revealed that the rural participation rate touched 41.82 per cent, marking a record high in the last 23 months. However, at a pan-India level, the labour participation rate dipped slightly to 40.80 per cent in September, against 41.16 per cent in August.